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Aside from a self-inflicted wound delivered by Santa Barbara City Administrator Jim Armstrong and a shouting match between Councilmember Dale Francisco and citizen crusader Kate Smith, City Hall’s controversial employee loan program emerged relatively unscathed from its first review by the council’s Finance Committee after the story broke three weeks ago.

Since 2001, City Hall has loaned a total of $4.8 million from General Fund reserves to 45 employees in order to attract and retain workers by helping them buy homes on the South Coast. Public-access TV talk-show host and City Hall watchdog Ernie Salomon has complained the program lacked sufficient oversight, that many of the loans were issued after the real estate market collapsed, and that some of the properties are now worth less than their loans are. Had that money not been loaned out, he claimed, the cash-strapped city’s reserves would be in better shape.

Armstrong emailed Lopez back, instructing him to take his time processing Molina’s request. Armstrong accidentally emailed his instruction to Molina, as well, who has since made hay of it in the pages of the Sound.

The Daily Sound has picked up the story and run with it. Last Friday, Sound reporter Josh Molina submitted a request for information to assistant administrator Marcelo Lopez, who then sent the request up to administrator Jim Armstrong. Armstrong emailed Lopez back, instructing him to take his time processing Molina’s request. Armstrong accidentally emailed his instruction to Molina, as well, who has since made hay of it in the pages of the Sound. Molina wound up getting a response to his request by Monday.

But according to an initial report issued by Finance Director Bob Samario, the loan program does not rise to the level of municipal scandal. Of the 48 loans issued, nine have been paid off entirely. Of the 36 loans — worth $3.8 million — remaining, $1.6 million in principal and interest have been paid off. None have been defaulted on. One is $5,000 in arrears. And two — worth $191,000 — are coming due soon and could be at risk. Samario said the average loan recipient had worked for City Hall 7.8 years. Three had worked for 20 years or more; 13, for three years or less. Three were department heads. And six have either retired or left City Hall. Although a handful of loans were issued after the market crashed, the City Council approved dipping into reserves to pay for them on three separate occasions. All those votes took place before the crash. They also took place when City Hall had more in reserves than city policy dictated. Since then, reserves have dropped to roughly 10 percent of what policy dictates.

Even Councilmember Michael Self, who has been harshly critical of the loan program in Sound articles, said she had no beef with the program or the employees who take advantage of it. She did express concern that the politically moribund Plan Santa Barbara has called for expanding the program. Councilmember Bendy White expressed concern that the loans did damage to the city’s reserves, but Samario insisted they had no impact.

To the extent there were fireworks, they came when Kate Smith — an outspoken critic of what she terms “the school-to-prison pipeline” — repeatedly chided Councilmember Francisco, chairing the meeting, to stop looking at the clock and pay attention. Francisco — who has locked horns with Smith before — would notify her of how much time she had left to speak every 30 seconds or so. When he announced that Smith’s two minutes at the mike were up, she refused to go, and a shouting match ensued. Francisco prevailed by killing the mike and adjourning the meeting until Smith left.

Comments

Daily Sound reporter/editor Josh Molina certainly has written several articles building upon, but the making-hay reference here by the Indy seems to be more about the Daily Sound rapid-deployment editorial that was authored by its Owner/Publisher, Jeramy Gordon, not Molina.

Here >>> http://www.ustream.tv/recorded/13824869 you can hear Council Member Michael Self complain about something she's not complaining about. You can also view the like minded Ernie Salomon blow smoke up her nostrils for not "waffling" due to her self described attribute 'graciousness of age.' That was shortly after Self essentially called the senior planner of Plan Santa Barbara a teenager.

The problem is; Michael Self does not have the ability to comprehend complex concepts presented to her, especially if there is a historical context; hence she gets stuck in her own thoughts. Ms. Self seemingly can only process narrow concepts; she often cannot keep her own thoughts in context; often resulting in making illogical and insulting conclusions. It appears as if a concept isn't already embedded in Ms. Selfs' brain she cannot be swayed, due to a dangerously recalcitrant nature. Finishing a thought or expanding on a concept can be difficult for most but this council member is just as nutty as fruitcake or even as nutty as Sarah Palin.

Ms. Self is on our very first representative body of government! If you voted for Ms. Self and still think she's a good decision maker for this city, you're either not paying attention or are probably a bit nutty too.

I'm really hoping these members of the Finance Cmte, Ms. Self, and Bendy, can educate themselves a little faster on some fairly basic finance. DonMcD is right, there is probably no hope for Ms. Self, but there's a chance with Bendy.

Bendy is worried that these loans have depleted the Reserves, Samario correctly says no. Bendy needs to understand, the City's reserves aren't just sitting around as cash. They're invested of course ... but they don't "go away" when they're invested. A very small amount is invested in 2nd Deeds of Trust on EMLAP loans to employees. A whole lot is invested in the LAIF fund ($42 million as of 2/28) and in Federal Agencies ($112 million). The Agencies are overwhelmingly composed of FannieMaes and FreddieMacs. Mortgages basically.

Wonder how many mortgages are under water inside all those FannieMaes and FreddieMacs? Oh my, yet another huge scandal and cover up waiting to be unearthed by Earnie, Michael, Jeramy, and Josh! Its much worse than we thought ... the City has invested more than a hundred million in mortgages!

Jeramy needs to cruise around the City's website and review the data that's there for all to see, he'll find all the answers he claims to be looking for. Transparency ... it's all there, but even if your windows are clean, you still have to be willing to open your eyes if you want to see the view.

My favorite "Self-inflicted wound" was last year when she was debating City Staff on whether the use of reusable grocery bags should be encouraged by charging a small fee for plastic bags .... Self was against reusable bags because she had heard dangerous levels of bacteria could grow in the bags.

Apparently, its never occurred to Self that items like her reusable underwear and reusable grocery bags can be occasionally laundered rather than throwing them out to avoid bacterial buildup!

I said hello to council member Self in Home Depot last December. She offered up that she was there stocking up on incandescent light bulbs because the government is outlawing them. So her cart was 1/3 full of old technology, a lifetime supply. I understand the CFL issues but Self really seems to get most of her information from Andrew Breitbart types, therefore seems a bit fearful of change or even newer overall superior technologies. This is not good for decision making in the home, business or government.

CFL - Saving energy is a great idea. 5 mg/Hg per bulb and 70% of original fc after 3 years really isn't a good idea. LED's are the way to go. I'm glad UCSB researchers are making progress on LED quantum droop. I can't blame Self for stocking up. I'm not a hoarder, but I've had to replace the CF floods in my kitchen with incandescents so I can see. I'm more concerned about political whoring by Schneider, House, and (past) Williams and psychopathic lying, manipulation, and inability to tolerate frustration by Francisco. Self isn't the brightest light on the block, and I disagree with most of her opinions, but I think she's honest, and in the last couple of years, all I can say for the nominal liberals is that they're for sale, and the buyers haven't been liberals. I regret the decision to pay a real salary to city hall officials. I thought it would shift interest from poorly-informed wealthy special interest supporters who were out of touch with the community, towards educated community activists. I think we've attracted people who offer the city their need for employment and lack of interest in due diligence. The SB government farce is embarrassing.